Federated National Insurance

Federated National Insurance
Tuesday, December 12, 2017

Reinsurance Program

Federated National Insurance Company

Federated National Insurance Company (“Federated National,” NAIC #10790) is an admitted insurance carrier licensed to write homeowners insurance in the states of Florida, Alabama, Louisiana, Texas and South Carolina. Federated National has a reinsurance program that affords its policyholders approximately $2.19 billion of aggregate coverage, with a maximum single event limit of approximately $1.56 billion. This reinsurance program, at a cost of nearly $180 million, is designed to reimburse Federated National for losses incurred by our homeowner policyholders’ resulting from one or more catastrophic events, including hurricanes. Federated National’s per event pre-tax net retention in Florida is $18 million and we purchase a separate underlying reinsurance agreement to cover first event losses outside of Florida for $5 million excess of $13 million and second event losses (hurricane only) for $16 million excess of $2 million. We utilize reinsurance to protect our existing capital and reduce our earnings volatility while significantly decreasing our financial exposure to hurricanes.

Federated National has a Financial Stability Rating of “A” which is “Exceptional” with Demotech, Inc.

Annual reinsurance agreements are effective July 1, 2017 through June 30, 2018.
Reinsurance Company   A.M. Best S&P
Allianz Risk Transfer AG (opo Nephila) A+ g AA-
Allied World Assurance Company, Limited A u A
American Agricultural Insurance Company A A+
American Standard Insurance Company of Wisconsin A A+
Arch Reinsurance Limited A+ u A+
Argo Re Ltd A A+
Ariel Re Bermuda Ltd A A+
Ascot Underwriting (Bermuda) Limited A A+
Aspen Bermuda Limited A g A+
AXIS Specialty Limited A+ A+
Brit Bermuda (BGS Services Limited) A A+
China Reinsurance (Group) Corporation A A+
Chubb Tempest Reinsurance Ltd. A++ AA
DaVinci Reinsurance Ltd. A AA-
Endurance Specialty Insurance Ltd. A+ A
Everest Reinsurance Company A+g A+
Fidelis Insurance Bermuda Limited A- NR
Fubon Insurance Co., Ltd. A A-
General Insurance Corporation of India, trading as GIC Re A- NR
Greenlight Reinsurance Limited A- NR
Hamilton Re, Ltd. A- u NR
Hannover Rueck SE (obo Katarsis Capital Advisors) A+ AA-
Hannover Rueck SE (obo Pillar Capital Management) A+ A+AA-
Hiscox Insurance Company (Bermuda) Limited A A
Lansforsakringar Sak Forsakringsaktiebolag (publ) NR A
Liberty Specialty Services Ltd (Paris)/Lloyd’s Syndicate 4472 A A+
Lloyds of London (multiple syndicates) A A+
MS Amlin AG, Switzerland, Bermuda Branch A A
Navigators Insurance Company A A
Neon Underwriting Bermuda Limited A A+
New India Assurance Company Limited, UK Branch A- NR
Odyssey Reinsurance Company A A-
Partner Reinsurance Company Limited A g A+
Peak Reinsurance Company Ltd A- NR
Pioneer Underwriting Limited (UCCDF)/Taiping Reinsurance Co. Ltd A A
Pioneer Underwriting Limited/Cathay Century Delegated Facility NR A-
Pioneer Underwriting Ltd (Pioneer CAT USDF) / Peak Reinsurance Company Ltd A- NR
Qatar Reinsurance Company Limited A g A
Renaissance Reinsurance Ltd. A+ AA-
Swiss Re Underwriters’ Agency/Swiss Reinsurance A+ g AA-
The Cincinnati Insurance Company A+ A+
Tokio Millennium Re AG (obo Elementum Advisors) A++ A+
Tokio Millennium Re AG (obo Securis Investments) A++ A+
Transatlantic Reinsurance Company A+ A+
TransRe/General Reinsurance Corporation A++ AA++
XL Bermuda Ltd A A+
Aeolus Re Ltd Collateralized* Collateralized*
Collateralised Re Ltd Collateralized* Collateralized*
Horseshoe Re Limited Collateralized* Collateralized*
Poseidon Re Limited Collateralized* Collateralized*
Securis Capital (London) Collateralized* Collateralized*

*Collateralized means the reinsurance company has already pledged the full resources that Federated National may need in the event of a claim.

Monarch National Insurance Company

Monarch National Insurance Company (“Monarch National,” NAIC #15715) is an admitted insurance carrier licensed to write homeowners insurance in the state of Florida. Monarch National has a reinsurance program that affords its policyholders approximately $109.81 million of aggregate coverage, with a maximum single event limit of approximately $68.89 million. This reinsurance program, at a cost of approximately $5.17 million, is designed to reimburse Monarch National for losses incurred by our homeowner policyholders’ resulting from one or more catastrophic events, including hurricanes. Monarch National’s per event pre-tax net retention is $3.4 million. We utilize reinsurance to protect our existing capital and reduce our earnings volatility while significantly decreasing our financial exposure to hurricanes.
Monarch National has a Financial Stability Rating of “A” which is “Exceptional” with Demotech, Inc.

Annual reinsurance agreements are effective July 1, 2017 through June 30, 2018.
Reinsurer Name AM Best Rating S&P Rating
Reinsurance Company
Ascot Underwriting (Bermuda) Limited A A+
Chubb Tempest Reinsurance Ltd. A++ AA
DaVinci Reinsurance Ltd A AA-
Fidelis Insurance Bermuda Limited A- NR
Hannover Rueck SE (obo Pillar Capital Management) A+ AA-
Hiscox Insurance Company (Bermuda) Limited A A
Lloyds of London
Blenheim Syndicate 5886 (WBC) A A+
Brit Syndicate 2987 / 2988 (BRT) A A+
Hiscox Syndicate 0033 (HIS) A A+
MAP Syndicate 2791 (MAP) A A+
Partner Reinsurance Company Limited A g A+
Pioneer Underwriting Limited/Cathay Century Delegated Facility NR A-
Pioneer Underwriting Ltd (Pioneer CAT USDF) / Peak Reinsurance
Company Ltd A- NR A- NR
Transatlantic Reinsurance Company A+ A+
TransRe/General Reinsurance Corporation A++ AA+